WHAT do British Prime Minister David Cameron and Argentine President Mauricio Macri have in common apart from their right-wing, conservative politics? Well both have now admitted that their wealthy fathers had offshore investments and they benefited from these.
Of course, when the leaders are democratically elected, political icons of the West and Latin America respectively, any offshore investment is called just that, an investment. When the offshore investment is held by a Third World dictator, there is a change in nomenclature, and words and phrases such as ‘stash’, ‘hidden loot’, ‘secret piles of dirty money’ etc are used.
Our prime minister is different, isn’t he? Whereas the British and Argentine leaders benefited from their wealthy fathers’ offshore investments, the Sharif family’s offshore interests were held in the name of the prime minister’s children ie his two sons.
The names of his daughter and son-in-law were also mentioned as beneficiaries. And there is no ‘evidence’ so far that the poor father has benefited from the children’s good fortune. None of his children has run for public office so no issue of a mis-declaration of assets has arisen.
The day the story of the Panama Papers broke, a journalist tweeted that there was nothing surprising or new in the fact that the rich were hiding their money from the prying eyes of the taxman or someone else who could ask them about the source of their wealth.
This has been happening for years and years. We rather naively express shock, even outrage, every time we find out. Then, within weeks of the scandal becoming public and possibly claiming one or two casualties, such as Iceland’s prime minister on this occasion, from among the thousands of beneficiaries of offshore financial activities, the story is forgotten. It is business as usual.
My familiarity with offshore companies is restricted to two specific areas. In the years I lived in the UK, I read in the papers that it was common practice for overseas investors to buy expensive properties in London in the name of offshore companies so the stamp duty could be avoided.
There is no ‘evidence’ so far that the poor PM has benefited from his children’s good fortune.
This, for example, saved the buyer in excess of a million pounds in stamp duty charges when purchasing a property of, say, £10m. This was totally legal and fell in the realm of tax avoidance and not evasion. The British government has recently said it was closing that loophole.
Another reason for the use of offshore companies was, of course, anonymity. Everyone would recall the time when, during the PPP’s second tenure, the story of the 1995 purchase of the Surrey Estate ‘Rockwood’ (Surrey Palace) broke in the media and Asif Ali Zardari denied ownership. Records showed it was owned by an offshore company.
In 2004, when the property was eventually auctioned off, lawyers said to be acting on behalf of Mr Zardari submitted paperwork saying he was the beneficiary of the offshore company investments and, therefore, entitled to the sales proceeds. It took him nine years and the possibility of losing several millions pounds to finally own up to his property.
The Sharifs’ defence of their use of offshore investment vehicles is that they were forced to use these to buy UK properties whilst in exile in Saudi Arabia. It isn’t clear this will stand to (chronological) test. Like Mr Zardari in the past, they have denied any impropriety and illegality, while saying they were prepared to face any inquiry.
I am sure they didn’t mean ‘any’ inquiry. I say this because the Panama Papers reminded me of an interesting story narrated to me by a journalist friend in London many years ago. The journalist said he got access to the top investigator of a firm the then accountability czar senator Saifur Rehman hired to track down the PPP leaders’ wealth.
His forensic investigation was successful and the investigator was asked to come to Pakistan with the case file and present it to the prime minister. He told my journalist friend that on reaching Islamabad he was informed Mr Sharif was travelling in his jet and would like him to join him on board to present his report.
He said he was already seated in the prime ministerial jet when Mr Sharif came aboard. “In the prime minister’s presence I was a bit awkward so rather abruptly said ‘Sir, you won’t believe what we have found’.
“He sort of froze, the colour began to drain from his face and he looked away. It took me a while to realise that he had completely misunderstood me. So I hastened to add, ‘We have found something incredibly damning of the PPP leaders in Switzerland’. He looked at me as if for confirmation, I nodded and he started to relax, smile and asked me to brief him.”
Anecdotes aside, I don’t know if any laws were broken when the Sharifs used the offshore investment vehicles. If they were, one earnestly hopes the law deals mercilessly with the violators. But there is the larger issue of morality, of ethical conduct whilst in office, of being open if you have nothing to hide.
Sadly, given the attitudes in society probity looks like a luxury only a handful can afford and, therefore, it rarely enters the equation. Not in politics, not in business and, dare I say, not in journalism. Just look around you for evidence.
Before I conclude allow me to set the record straight. After reading my column last week, Mr Farooq Shah emailed me on behalf of former minister and noted Sunni Muslim Barelvi leader Hamid Saeed Kazmi.
Mr Shah said Mr Kazmi’s supporters never joined the Islamabad Qadri protests. He said the majority of Barelvi ulema were against such street agitation and only Sunni Tehreek was trying to foment chaos. I must have been misinformed and apologise to Mr Kazmi for writing that he supported the sit-in.
The writer is a former editor of Dawn.
Published in Dawn, April 9th, 2016